This Page's Content Was Last Updated: October 31, 2022
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What You Should Know
Credit cards in Canada offer up to 5% back in rewards on grocery shopping.
Not all stores that sell groceries are categorized as groceries by credit card networks.
Not all grocery stores accept all types of credit cards.
Costco is not categorized as a grocery store by credit card networks.
Walmart is not recognized as a grocery store by credit card networks; however, Walmart supercenters are recognized as grocery stores by Mastercard.
You can find out if a store is categorized as a grocery store through its assigned merchant code.
Groceries account for a substantial part of the monthly expenses of an average Canadian. With inflation adding to this expense, there may not be a better time to get a credit card that offers rewards on groceries. In Canada, you may be able to earn rewards in the form of reward points or cash back at your local grocery store by getting a card which is accepted there.
However, it is noteworthy that your grocery store may not be recognized by your credit card network as a grocery. For example, you may be stocking up on your essentials in bulk from Costco to save money; however, Costco is not recognized as a grocery store by credit card networks, so you may not be able to double down on the savings. We have listed some of the best credit cards for groceries below.
Cash Back: Cash back rewards are straightforward. If the cash back rate for a card is 4% on groceries, you earn 4% cash back on every purchase that qualifies as a grocery purchase. The cash back rewards are accumulated in your account which can be redeemed to pay off your credit. Some cards may have a minimum redemption, for example, you may require to have a minimum of $10 cash back reward balance to be able to redeem it.
Reward Points: Reward points on the other hand are not as straightforward. The redemption value of reward points usually varies depending on where you redeem them. For example, Scotia Scene+ points can be redeemed at a 1 cent per point (CPP) value for Cineplex movie tickets and partner groceries, however; if you wish to redeem the points for statement credits, you will get a value of 0.7 cents per point.
Hacks for Earning Maximum Points
Grocery is a very competitive category when it comes to credit card rewards with most credit cards offering bonus rewards on shopping at grocery stores. One hack to maximize your reward points is to purchase gift cards for stores that don’t fall under the grocery category (such as Home Depot) at a grocery store. This way, you could earn more points on your non grocery purchases as well.
However, you would not get the purchase protection and extended warranty if you use this hack, which some credit cards offer when you use them for your purchases.
Order Online via Instacart
If you want to use your AMEX to buy groceries from a store that does not accept AMEX such as Loblaws or Costco, you could use the online grocery delivery service Instacart and pay using your AMEX.
What’s more is that since Instacart is categorized under grocery by credit card networks, you could earn bonus points for grocery shopping that you otherwise won’t while shopping in-store at Costco and some Walmart stores that don’t fall under the grocery category. However, you should note that some stores may offer a different price on the products and not all products may be available online.
There is no one size fits all when it comes to credit cards for grocery. Some credit cards that offer great rewards on groceries may not be accepted at your local grocery store or your grocery may not qualify as a grocery as per the credit card network guidelines. A store that offers the best benefits, such as Costco, may not qualify as a grocery at all.
Another consideration should be the credit card fees. Most credit cards that offer good rewards on groceries come with an annual fee and to get the best value of these cards, your grocery expenditure should be enough to justify the fees you pay. For example, if you get the Scotia Momentum Visa Infinite only for groceries, that has an annual fee of $120 and a cash back rate of 4% on groceries, you should at least be spending $3,000 on groceries annually to be able to at least cover the credit card fees in cash back. If your grocery expenditure is very low and you mostly rely on eating out or food deliveries, you may be better off spending on a card that offers better benefits on dining and food delivery rather than on groceries. Therefore, it is best to assess your individual situation and pick a card that may be best for you.
Frequently Asked Questions
Is Walmart considered as a grocery store for rewards?
Unfortunately, not all Walmart stores are considered as grocery stores by credit card networks. While VISA and AMEX don’t categorize Walmart as groceries at all, Mastercard has categorized only Walmart Supercentres as grocery stores. If you shop for your groceries at Walmart Supercentres, you could use a mastercard such as BMO Cash Back World Elite Mastercard to earn maximum value. You could also check the National Bank World Elite Mastercard.
For all other Walmart Stores, you could use a card such as the American Express SimplyCash Preferred card that offers 2% cash back on all purchases, or the Walmart Rewards World Mastercard that offers 3% and 1.25% Walmart reward dollars on shopping online at Walmart.ca and in-store respectively.
Is Costco considered as a grocery store for rewards?
Similar to Walmart, Costco stores are also not categorized as a grocery store by credit card networks. Instead, Costco is categorized as a discount merchant and you will earn only the base cash back or reward points rate at Costco. To maximize rewards at Costco, you could get a credit card that offers a good base rewards rate such as the Rogers World Elite Mastercard that offers 1.5% cash back on all purchases.
What credit cards does Costco Canada accept?
Costco accepts only Mastercard credit cards for payments, apart from cash and debit cards. Costco does not accept Visa and Amex Credit cards. Considering that Costco is not categorized as a grocery store by credit card networks, you could use a mastercard that offers a high base reward rate to earn maximum rewards at Costco.
Does No Frills accept Visa?
No Frills now accepts both Visa and Mastercard Credit Cards. However, they do not accept AMEX credit cards at this time. It is also noteworthy that No Frills does not accept Mastercard Debit at this time.
What are the grocery stores that accept AMEX in Canada?
Amex cards such as the Scotia Gold Amex and American Express Cobalt offer great rewards on groceries. However, some stores do not accept AMEX for your purchases such as the Loblaws Companies stores. Some of the major Canadian groceries that accept AMEX are: Sobeys, Longo’s, IGA, FreshCo, Rabba, Metro, Farm Boy, Foodland, Safeway, Pusateri’s, 88 Supermarket and Whole Foods. You could also use AMEX to purchase groceries through Instacart.
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